HOUSTON--(BUSINESS WIRE)--Dynegy Inc. (NYSE: DYN) today announced that Institutional Shareholder
Services (“ISS”), the leading independent proxy advisory firm,
recommended that Dynegy stockholders vote FOR
the proposal to adopt the merger agreement with an affiliate of The
Blackstone Group L.P. at Dynegy’s November 17, 2010 Special Meeting of
Stockholders. As previously announced, under the terms of the merger
agreement, Dynegy stockholders will receive $4.50 in cash for each
outstanding share of Dynegy common stock they own in a transaction
valued at $4.7 billion, including the assumption of existing debt.

In its November 7, 2010 report, ISS noted (emphasis added):1

Based on the lack of any competing bids from the go-shop process,
moreover, as well as our own analysis of the likely stand-alone value
of the stock without this transaction, we believe the offer
represents a fair price with a reasonable premium, and recommend
shareholders vote FOR the merger.

In aggregate - the substantial detail buttressing the company’s
assertions, the continued deterioration in natural gas price
forecasts, and the concurrence of many equity analysts - we believe
the strategic rationale for the sale is credible.

[F]undamentals seem to have deteriorated since announcement, with the
average price for natural gas on the 5-year forward curve having
decreased 7.1% and analysts having cut their estimates. Based on
the historical relationship with peers and the current consensus 2011
EBITDA estimates, the stock standalone value would be $2.66.

The company has provided extensive detail to support its
financial projections, including modeling certain counterproposals
(e.g. remain stand-alone and sell the gas assets to NRG or another
competitor directly) to demonstrate the increasingly tight corner in
which the company now finds itself. Despite Seneca’s argument
that a gas price below $5 – the minimum at which many producers would
earn an acceptable return – is unsustainable, the average price on the
forward 5-year curve – already down 37% over the two years prior to
the deal’s announcement – fell an additional 7% in the two months
after the deal was announced, to an average price of $4.98.

We believe that…the issue appears to be the near-impossibility—as the
board has argued, and the go-shop results testify—of realizing a
higher value through a change in control transaction.

“We are pleased that ISS supports the Dynegy Board’s view that the
merger provides fair value to all Dynegy stockholders,” said Bruce A.
Williamson, Chairman, President and Chief Executive Officer of Dynegy
Inc. “ISS analyzed the situation correctly and also points out that the
near-term risk in natural gas pricing, which our Board was very
concerned about, has in effect come to pass and, therefore, this
transaction represents substantial and certain value over where the
stock would likely be trading. ISS further recognizes that Dynegy
continues to face challenges, many of which are beyond its control,
including low and declining commodity prices and continued economic
weakness.”

Williamson concluded, “Over the past two years, Dynegy’s Board conducted
a thorough review of strategic alternatives to maximize value
for stockholders; the Board believes that the Blackstone transaction is
the best alternative available. Dynegy urges stockholders to follow the
recommendation of ISS and to vote for the adoption of the merger
agreement in order to capture this premium and certainty of value.”

ISS is the leading independent proxy voting and corporate governance
advisory firm. The recommendations of ISS are relied upon by hundreds of
major institutional investment firms, mutual funds and other fiduciaries
throughout the country.

Dynegy’s Special Meeting of Stockholders will be convened as scheduled
at 10 a.m. CT/11 a.m. ET on Wednesday, November 17, 2010, at the
company’s corporate headquarters, 1000 Louisiana St., Houston, Texas
77002. Dynegy stockholders of record at the close of business on Friday,
October 1, 2010, will be entitled to receive notice of the special
meeting and to vote at the special meeting.

The Dynegy Board of Directors recommends stockholders vote FOR
the proposal to adopt the merger agreement today – by telephone, by
Internet or by signing, dating and returning the Company’s WHITE
proxy card. A failure to vote will have the same effect as a
vote AGAINST the proposal to adopt the merger agreement.

Stockholders who have any questions or need assistance voting their
shares should contact MacKenzie Partners, Inc., Dynegy’s proxy
solicitor, by calling toll-free at (800) 322-2885 or (212) 929-5500
(call collect) or by e-mailing dynegy@mackenziepartners.com.

For more information, stockholders are encouraged to read Dynegy’s
definitive proxy statement, which was filed with the SEC on October 4,
2010; an Investor Presentation that was filed with the SEC on October 5,
2010 and updates to that Investor Presentation that were filed with the
SEC on October 19, 2010, and October 27, 2010, respectively; and letters
to stockholders that were filed with the SEC and issued as press
releases on October 6, 2010, October 19, 2010, October 26, 2010, and
November 2, 2010, respectively.

If you have any questions, require assistance in voting your shares,
or need

Through its subsidiaries, Dynegy Inc. produces and sells electric energy
capacity and ancillary services in key U.S. markets. The power
generation portfolio consists of approximately 12,200 megawatts of
baseload, intermediate and peaking power plants fueled by a mix of
natural gas, coal and fuel oil. For more information, please visit www.dynegy.com.

Cautionary Statement Regarding Forward-Looking Statements

This release contains statements reflecting assumptions, expectations,
projections, intentions or beliefs about future events that are intended
as "forward-looking statements". All statements included or incorporated
by reference in this release, other than statements of historical fact,
that address activities, events or developments that we or our
management expect, believe or anticipate will or may occur in the future
are forward-looking statements. These statements represent our
reasonable judgment on the future based on various factors and using
numerous assumptions and are subject to known and unknown risks,
uncertainties and other factors that could cause our actual results and
financial position to differ materially from those contemplated by the
statements. You can identify these statements by the fact that they do
not relate strictly to historical or current facts. They use words such
as "anticipate", "estimate", "project", "forecast", "plan", "may",
"will", "should", "expect" and other words of similar meaning. In
particular, these include, but are not limited to, statements relating
to the following: (i) the timing and anticipated benefits to be achieved
through our 2010-2013 company-wide cost savings program; (ii) beliefs
and assumptions relating to liquidity, available borrowing capacity and
capital resources generally; (iii) expectations regarding environmental
matters, including costs of compliance, availability and adequacy of
emission credits, and the impact of ongoing proceedings and potential
regulations or changes to current regulations, including those relating
to climate change, air emissions, cooling water intake structures, coal
combustion byproducts, and other laws and regulations to which we are,
or could become, subject; (iv) beliefs about commodity pricing and
generation volumes; (v) anticipated liquidity in the regional power and
fuel markets in which we transact, including the extent to which such
liquidity could be affected by poor economic and financial market
conditions or new regulations and any resulting impacts on financial
institutions and other current and potential counterparties; (vi)
sufficiency of, access to and costs associated with coal, fuel oil and
natural gas inventories and transportation thereof; (vii) beliefs and
assumptions about market competition, generation capacity and regional
supply and demand characteristics of the wholesale power generation
market, including the potential for a market recovery over the longer
term; (viii) the effectiveness of our strategies to capture
opportunities presented by changes in commodity prices and to manage our
exposure to energy price volatility; (ix) beliefs and assumptions about
weather and general economic conditions; (x) beliefs regarding the U.S.
economy, its trajectory and its impacts, as well as Dynegy’s stock
price; (xi) projected operating or financial results, including
anticipated cash flows from operations, revenues and profitability;
(xii) beliefs and expectations regarding the Plum Point Project; (xiii)
expectations regarding our revolver capacity, credit facility
compliance, collateral demands, capital expenditures, interest expense
and other payments; (xiv) our focus on safety and our ability to
efficiently operate our assets so as to maximize our revenue generating
opportunities and operating margins; (xv) beliefs about the outcome of
legal, regulatory, administrative and legislative matters; (xvi)
expectations and estimates regarding capital and maintenance
expenditures, including the Midwest Consent Decree and its associated
costs; and (xvii) uncertainties associated with the proposed merger of
Dynegy and an affiliate of Blackstone (the “Merger”), including
uncertainties relating to the anticipated timing of filings and
approvals relating to the Merger and the sale by an affiliate of
Blackstone of certain assets to NRG Energy, Inc. (the "NRG Sale"), the
outcome of legal proceedings that have been or may be instituted against
Dynegy and/or others relating to the Merger and/or the NRG Sale, the
expected timing of completion of the Merger and the NRG Sale, the
satisfaction of the conditions to the consummation of the Merger and the
NRG Sale and the ability to complete the Merger and the NRG Sale.

Any or all of our forward-looking statements may turn out to be wrong.
They can be affected by inaccurate assumptions or by known or unknown
risks, uncertainties and other factors, many of which are beyond our
control.

ADDITIONAL INFORMATION AND WHERE TO FIND IT

In connection with the Merger, Dynegy filed a definitive proxy statement
with the SEC on October 4, 2010, and commenced mailing the definitive
proxy statement and form of proxy to the stockholders of Dynegy. BEFORE
MAKING ANY VOTING DECISION, DYNEGY'S STOCKHOLDERS ARE URGED TO READ THE
DEFINITIVE PROXY STATEMENT REGARDING THE MERGER CAREFULLY AND IN ITS
ENTIRETY BECAUSE IT CONTAINS IMPORTANT INFORMATION ABOUT THE PROPOSED
MERGER. Dynegy’s stockholders are able to obtain, without charge, a copy
of the definitive proxy statement and other relevant documents filed
with the SEC from the SEC’s website at http://www.sec.gov.
Dynegy’s stockholders are also able to obtain, without charge, a copy of
the definitive proxy statement and other relevant documents by directing
a request by mail or telephone to Dynegy Inc., Attn: Corporate
Secretary, 1000 Louisiana Street, Suite 5800, Houston, Texas 77002,
telephone: (713) 507-6400, or from Dynegy’s website, http://www.dynegy.com.

PARTICIPANTS IN THE SOLICITATION

Dynegy and its directors and officers may be deemed to be participants
in the solicitation of proxies from Dynegy’s stockholders with respect
to the Merger. Information about Dynegy’s directors and executive
officers and their ownership of Dynegy’s common stock is set forth in
the proxy statement for Dynegy’s 2010 Annual Meeting of Stockholders,
which was filed with the SEC on April 2, 2010. Stockholders may obtain
additional information regarding the interests of Dynegy and its
directors and executive officers in the Merger, which may be different
than those of Dynegy’s stockholders generally, by reading the definitive
proxy statement filed with the SEC on October 4, 2010 and other relevant
documents regarding the Merger when filed with the SEC.